In surprisingly speedy confirmation of a theory we presented yesterday, more evidence has emerged that some, and perhaps most, of the CalPERS board members have either lost their minds or are frightfully stupid.

The object lessons today are Board President Henry Jones, and a repeat performance by Theresa Taylor, both of whom violated closed session confidentiality. The hypocrisy should be obvious: this is the smear the majority board faction regularly, applies to the pro-accountability minority. Keep in mind that there’s never been any evidence presented of the dissenters actually having conveyed state secrets to the media.

Nevertheless, the CalPERS board has a self-serving Commies-under-every-bed obsession with the idea that all of its woes are due to loose-lipped board members. In a ham-handed effort that would give McCarthyism a good name, the board is setting out to persecute fellow members who talk to the press, even when the information they discussed wasn’t confidential.

But as the board has whipped itself into a frenzy over its leaking canard, it also has clear a double standard at work. Prominent members of the board have been shamelessly and openly engaging in the sort of leaking they’ve demonized, when they have yet to establish that any of the pro-transparency board members in the opposition has done anything wrong.

As for the fresh example, it reflects badly on Board President Henry Jones not only for his hypocrisy but also for being a dupe.

In a PE Hub story yesterday, CalPERS Board president: PE partners chased away by board leaks, Jones presents with a straight face the ludicrous idea that CalPERS was unable to get anyone interested in their poorly-thought out, shape-shifting private equity plan because Bloomberg published the names of two people talking to CalPERS.

Those two people happened to be two unemployed people. One was the retired co-founder of the top tier private equity firm Silver Lake. The second had just been designated a senior adviser. When that happens to a full time private equity firm employee, which was the case here, that means he’s being eased out.

But Jones is so clueless he treats everything he is told by CalPERS staff as gospel truth. From PE Hub:

Candidates to help run California Public Employees Retirement System’s planned direct investment funds backed out due to an article that named two people associated with Silver Lake as being in the running, according to Henry Jones, president of CalPERS’s board….

“It wasn’t an interview, just [that] this is the type of people we’re looking at to do this work, and they were bringing them in and then the board would have a conversation with these potential people,” Jones said. “The problem was several of them bailed out because the information about them was leaked to the press. And so therefore they said, ‘I do not want to continue with this, stay with this endeavor.’”….

In January, John Cole, CalPERS’s senior portfolio manager for global equities, told Bloomberg in an on-the-record interview about two of the candidates CalPERS had been speaking with: David Roux and Adam Grosser, both of whom have worked with Silver Lake. Roux co-founded the rm before stepping away in 2010, and Grosser ran one of their funds and is now a senior adviser.

This is just silly. David Roux is a billionaire. Do you think it would matter one iota to him whether it was made public that he was considering saddling up for CalPERS’ private equity scheme?

And to the larger point, the claim that the Silver Lake candidates pulled back due to the Bloomberg story has not been presented in public. This was a closed session discussion.

And this gaffe is not going over well with CalPERS’ beneficiaries. As one said:

Let me get this straight — John Cole talked to Bloomberg in an attempt to straight-arm the board into thinking the ex-Silver Lake partners were a Done Deal that should be approved without a governance structure or terms in place, so other board members are “leakers.”

Henry Jones is out speaking publicly about specific negotiations less than 180 days old, that involve strategies currently in play, but other board members are “leakers.”

This is straight-up Gaslighting…

And another noted:

It’s amazing just how, like Theresa Taylor, Henry Jones considers himself to have impunity to violate the rules he tries to enforce on others. When caught red-handed on tape, he admitted that he was talking about the Silver Lake guys, which clearly established that he had disclosed closed session information. He could have instead either refused comment or, if he wanted to be tricky, said, “Oh, no. I was not referring to the Silver Lake guys. I was referring to other people that I happen to personally know who were interested but backed out because of the publicity. The board as a whole never even heard about those people.” This would have at least given him plausible deniability. Even if all the insiders would have thought he was lying, it would have been tough to prove. What he did instead shows that he had absolutely no concern about being caught out as a leaker.

Meanwhile, the other board leaker outed in the past week, Theresa Taylor, fell back on the tried and true CalPERS’ practice of lying to get herself out of hot water. The wee problem is she can’t unsay what she said. Here’s her latest, courtesy Randy Diamond of Chief Investment Officer:

Taylor told CIO Sunday that she did not violate any closed session rules because it has been disclosed publicly by the board that there was an investigation into leaks. It’s unclear when that disclosure occurred and Taylor was not immediately able to offer specifics.

Unfortunately, Diamond is so inattentive that he let this dodge stand. What Taylor impermissibly exposed, as we described clearly in our post, was the investigation findings. Specifically, from Diamond’s article last week:

Taylor said leaks to the press in past months seem to be coming from board members. She said a CalPERS internal investigation pinpointed that fact, but was not able to show with 100% accuracy which board members were leaking.

The second sentence is a clear-cut leak of closed session information.

One has to wonder if Taylor might have a defense because what she claimed was said in closed session was in fact apparently not said. Margaret Brown issued a press release disputing the accuracy of Taylor’s assertions and demanding the document be released. So would a deliberate misrepresentation of closed session information not be a violation?

1 It’s important to appreciate that the jihadist members of the board take a strong-form view of closed session confidentiality, which is why there casual disregard for it is so glaring. These board members appear to believe that anything that occurs in closed session is confidential, when that’s simply false. First, any public information does not become confidential by virtue of it also having been raised in closed session. Second, courts have ruled that non-public information that is not germane to the legal basis for holding a discussion is also not confidential. For instance, if the board were reviewing a private equity transaction, if someone presented a general economic forecast, that forecast would not be entitled to closed session confidentiality protection.

5 comments

I can’t speak for Mac users, but us lot labouring under the auspices of Windows are probably all well familiar with the font named “Wingdings”. Perhaps others have done as I have on occasions, inadvertently selected “Wingdings” as the font, then started typing. You’re always slightly aghast and amused if you weren’t touch typing but were instead glancing down at the keyboard for a while, before you looked up at the screen and noticed what had happened.

Everything you said ends up in a peculiarly hypnotic gibberish of odd looking characters — emojis, astrological signs, even religious symbols. The sheer random nonsense of it does have a kind of quiet, contemplative beauty to it — what started out as your train of thought becomes an impenetrable stream of visual noise.

Theresa Taylor’s statements would have, therefore, read better if they’d been written in Wingdings. Unfortunately, when rendered in a conventional Latin font, there is no disguising of and no hiding from the inane piffle which, one has to assume, not knowing whether to laugh or cry, Taylor actually did utter.

Let’s take this little treasure as an example:

Taylor said leaks to the press in past months seem to be coming from board members. She said a CalPERS internal investigation pinpointed that fact, but was not able to show with 100% accuracy which board members were leaking.

Where does one even start here? Initially, Taylor is all coy and seems determined to get herself typecast as the Teasy Weasy of Sacramento — taking plain, uninspired material and whipping it up into a gravity (certainly common-sense) defying confection (“leaks […] seem to be coming from board members”). “seem” is the hairpin which attempts to ensure the structural integrity of that sentence holds up, although it is, like Marcie Frost’s college credits, under something of a strain.

Alas, Taylor’s foot-high beehive then gets caught in a passing shower, because we have “CalPERS internal investigation pinpointed that fact” (a nice start — “pinpoint” and “fact” are good solid words, words that have a nice directness to them, you can chew on them — a bit like you can with “cockamamie”) but…

… why-oh-why is there always, like Ma saying that you can’t eat raw cookie dough, you have to patient, you’ll have a cookie, but, you’ll have to wait until they’re cooked, anyhow, back, because we’re good soldiers and aren’t about to be derelict in our duties, to Taylor…

“but” (Clive, briefly, out of necessity: does my butt look big in this?) “was not able to show with 100% accuracy which board members were leaking”.

Hey, wait a minute. How come we started off all hale and hearty, ready to call CalPERS security and have board refuseniks frogmarched out the building, with terms such as “pinpoint” ‘s and “fact” ‘s, now we’re suddenly in the land of “not able to show with 100% accuracy” ? I’ve not experienced such a bad let-down since I learned Dallas’s entire ninth season was all a dream.

I blame myself. How could I not, I should have seen it coming, because previously in an earlier Taylor utterance, we were advised “It’s unclear when that disclosure occurred and Taylor was not immediately able to offer specifics”. Possibly it really was just like Bobby Ewing did, and Theresa Taylor dreamt it all up?

Dear Yves, perhaps next time Taylor goes on the record, you could see your way to putting her missives in Wingdings font? At least then, like some sort of pastiche of a Jackson Pollock painting, they’d have some abstract mystery about them and the reader is free to interpret the meaning for themselves. In the original English, they merely suck.

This is becoming so patently aburd, I’m starting to imagine silly Monty-Python-esque sketches satirizing the whole CalPERS ‘management’. (It would be funny if the increasing financial harm to beneficiaries wasn’t so dangerous.)

My latest silly sketch: Empress Catherine II is traveling with her lover, Minister Potemkin, to see the wondrous villiages he’s constructed for benefit of the peasants. During a stop in one village, some person not part of the entourage looks behind the village facade and cries out, “there’s nothing there”! Minister Potemkin replies in thunderous, righteous anger, “But there would be something there if you hadn’t looked! Now you’ve scared away the buyers!”

Thanks again for your continued reporting on CalPERS, PE, and pensions.